WTR revisions – reporting procedures will still be key

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Robust sickness absence reporting procedures will be key if the proposed annual leave carry over provisions are enacted. Unscrupulous employees may try to defer annual leave by falsely claiming sickness while on holiday. Employers should therefore require notification of sickness as soon as possible. Even when the employee is out of the country on holiday, the employer might insist they call their manager and provide them with a copy of a fit note or the equivalent, as evidence of illness.

The proposals try to strike a balance between employee and employer on the issue of carrying over leave from one leave year to the next. Notably, carried over leave is limited to 4 weeks (the entitlement under the Working Time Directive) and employers can require employees to take leave when convenient for the employer, even if that means deferring it to the next leave year.

This may be of particular benefit to employers who have seasonal trading peaks. Not only would they be able to require an employee who has been absent from January to mid-November to work the remainder of the year to cover the Christmas rush and take accrued leave in the following leave year, but the employee’s deferred entitlement will be limited to 4 weeks, rather than 5.6. Of course, employers would need to consider the underlying reason for any sickness absence to ensure that they don’t fall foul of the disability-related provisions of the Equality Act 2010.

Employers will need their procedures to be clear as to when and how they have the right to defer leave. They can’t expect to be able to spring it on employees. Again, sickness absence reporting will be of primary importance. An employee in the situation mentioned above may seek to remain away from work for an additional six weeks so to avoid having to return during a busy trading period, notwithstanding that they may be fit for work.

Employers may also limit the impact of the carry-over provisions by ensuring that contracts of employment state the order in which leave is taken. The proposed default position (in the absence of contractual or other arrangements) is that the 4 protected weeks are taken first, and then the remaining 1.6 weeks. This will be particularly important when calculating leave entitlement on termination, where payment in lieu of carried over leave is to be made.

It is proposed that accrual of leave while on maternity and other family-related leave will be dealt with in the same way as sick leave, save that there is no reduction of entitlement. A maternity leaver who has been unable to take annual leave during a leave year could therefore carry over the full 5.6 weeks accrued entitlement to the following leave year. However, employers are assisted by the proposals allowing them to dictate when that leave is taken and clear policies and procedures should assist employee buy-in to the employer’s approach.